Code:
$key = file_get_contents($argv[3]);
if ($key === false)
die("Failed to open key file.");
$iv = $key;
LogDebug("Key: " . hexlify($key));
LogDebug("IV : " . hexlify($iv));
The IV isn't the same as the key.
According the HLS spec, if the IV isn't specified in the #EXT-X-KEY, which it isn't, then the IV is the sequence number. The #EXT-X-MEDIA-SEQUENCE tag specifies the starting sequence number for the playlist, in this case, 0. Each url in the playlist is a sequence. So the first url in this case is sequence #0, the second is sequence #1, etc.
The IV for each url is then encoded as a 128 bit big endian representation of the sequence number for that url.
So the first URL (sequence #0) the IV is \x00\x00\x00\x00\x00\x00\x00\x00\x00\x00\x00\x00\x 00\x00\x00\x00
For the second URL (sequence #1) the IV is \x00\x00\x00\x00\x00\x00\x00\x00\x00\x00\x00\x00\x 00\x00\x00\x01
and so forth.
I believe that's the reason why you can't decrypt.